Assume that you are the president of Propane Company. At the end of the first year (December 31, 2009) of operations, the following financial data for the company are available:

Cash .............................$22,500

Receivables from customers (all considered collectible) ......... 10,800

Inventory of merchandise (based on physical count and priced at cost) ... 81,000

Equipment owned, at cost less used portion ............. 40,700

Accounts payable owed to suppliers ................ 46,140

Salary payable for 2009 (on December 31, 2009, this was

owed to an employee who was away because of an emergency;

will return around January 10, 2010, at which time the payment

will be made) ......................... 1,800

Total sales revenue ......................126,000

Expenses, including the cost of the merchandise sold

(excluding income taxes) ..................... 80,200

Income taxes expense at 30% × pretax income; all paid during 2009 .... ?

Contributed capital, 7,000 shares outstanding ............. 87,000

Dividends declared and paid during 2009 ............. 12,000

Required (show computations):

Using the financial statement exhibits in the chapter as models:

1. Prepare a summarized income statement for the year 2009.

2. Prepare a statement of retained earnings for the year 2009.

3. Prepare a balance sheet at December 31, 2009.